-324-
Issue IV. Whether Kanter Received Unreported Income From Hi-
Chicago Trust During 1981 to 1983 (STJ report at 106-
111)130
Respondent determined that payments of $42,720, $19,247, and
$109,399 Hi-Chicago Trust made to THC during 1981, 1982, and
1983, respectively, constituted income earned by Kanter. The
parties filed with the Court a stipulation of settled issues in
which Kanter conceded the adjustment for the taxable year 1981.
The parties disagree whether the payments Hi-Chicago Trust made
to THC during 1982 and 1983 represent Kanter’s income.
FINDINGS OF FACT
Hi-Chicago Trust was established in 1972. The trust’s
beneficiaries included members of Hyman Federman’s family.
Federman is a friend of Kanter. Neither Kanter nor Kanter’s
family are or have been beneficiaries of the trust.
From Hi-Chicago Trust’s inception in 1972 through at least
1989, Kanter was trustee for the trust. The trust instrument
130 The STJ report recommended holding that respondent is
barred from making any determination concerning the taxable year
1983 on account of the expiration of the period of limitations
governing assessment and collection for that year. As previously
discussed, we determined that Kanter’s income tax returns for the
years at issue were fraudulent, and, therefore, the period of
limitations remains open pursuant to sec. 6501(c)(1).
The foregoing aside, the Court’s disposition of this issue
represents in large measure a wholesale adoption of the
recommended findings of fact and conclusions of law set forth in
the STJ report.
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